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Tibone advocates for support to local companies

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Speaking at the recent Botswana Stock Exchange Limited (BSEL) opening bell ceremony in Gaborone, businessman Charles Tibone has bemoaned that the economy is hunting for Foreign Direct Investment (FDI) and shunning local entrepreneurs.

He has therefore implored Government and the public in general to embrace growth of local businesses.“The core of your economy is your people and our businesses (local businesses) should be seen as assets in the economy,” Tibone said. Tibone said great initiatives have crumbled, due to market resistance which he views as the main challenge for most entrepreneurs.
Citing his pharmaceutical company which closed shop after two years of operation in the early 90s, Tibone said failure to get local support before accessing the export market, lead to the closure of the business.

Tibone said lack of local support is crippling many businesses, adding that once a business is funded or initiated, the owners should work hard.“You are on your own,” said Tibone emphasizing that most local entrepreneurs have had more failures than success, due to the limited success. Tibone’s sentiments are also shared by Botswana Export Manufacturers Association (BEMA), Nkosi Mwaba, who is on record calling for the local market to offer unwavering support to local enterprises.

“We need to unapologetically support, protect and develop local industries before rushing to conform to often unrealistic regional trade expectations,” Mwaba said. Mwaba further said free trade and an open border system is fair if aligned to the healthy development and growth of Botswana companies.

Meanwhile government has recently announced that it is enacting a Business Facilitation Law which will enhance the country’s international standing as an investment destination of choice. Last year, Botswana One Stop Service Shop Centre (BOSSC) was launched to shorten the turnaround time for foreign businesses seeking various government authorizations, business registration, issuance of work and residents permits at no cost to ensure quality service standards to investors.

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‘Manufacturing holds key to economic growth’

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Barclays bank’s economist Naledi Madala has urged the country to consider manufacturing, as a key tailwind to drive the economy and reduce inequality.

She was speaking at a gathering organised by the bank which focused on economic outlook for 2019. “We should not make a mistake of leapfrogging without manufacturing,” said Madala, lamenting that the country’s diversification remains a pipeline dream, as the diamond is still the economy’s mainstay. She bemoaned that mining activities in the country could not spring forward diversification, though non-mining GDP has been steady over the years.

“Extractive industries are not good stepping stones for diversification, the sector does not prepare us for the next step,” said Madala at the Barclays’ Economic Outlook Forum Review 2019. The economist further noted that government should confront head-on challenges of productivity and competitiveness to attract the much needed Foreign Direct Investment (FDI). Though diversification efforts continue to hit a brick wall, Madala said the country should expect increased activities in the mining sector hinged to ramp up in coal production in the year ahead.

She also implored government to consider a welcoming attitude towards foreign investors and generous tax incentives to businesses that set up in the country. Madala is also upbeat that the use of public private partnership model could also help diversify the economy coupled with privitisation. “Privitisation will offer opportunities for growth, through the renewed optimism from government, as business confidence has improved,” said Madala.

She implored the government and the business community to access what is going to drive and hinder growth highlighting that key headwinds to growth are income inequality, diversification challenge and productivity, among others. “The pace of poverty reduction has slowed down, while income inequality goes up,” said Madala

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MINISTER BEWAILS BAD REPAYMENT BY YOUTH

Keikantse Lesemela

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Minister of Youth Empowerment, Sports and Culture Development, Tshekedi Khama has told parliament his ministry continues to face challenges on the repayment of Youth Development Fund (YDF) loans.

Recently presenting the budget to Parliament, Khama said this financial year the ministry has received a total of 2582 YDF applications and approved 983of them to the value of P98 million. He said the programme attracts a high level of interest from youth but the ministry is only limited to funding a maximum of 1200 youth projects annually due to budget limitations.

“However the greatest challenge for the Fund is the repayment of the loan component by the majority of the youth businesses. The youth have advanced number of challenges for this including high rentals for operating spaces, low market access owing to tight competition and limited production capacities,” said Tshekedi, adding that they continue to pursue beneficiaries to repay the loans.

Out of the 919 businesses funded 1058 jobs have been created. The minister highlighted that disbursements of funds will continue to be undertaken until the end of the financial year. “The YDF is currently under review in line with the pronouncement made by the President, Dr Mokgweetsi Masisi in the State of the Nation Address, to improve beneficiaries through training, and encourage consortia and cooperatives,” said Tshekedi.

The ministry assists YDF beneficiaries in marketing their products and services through fairs and exhibitions. The ministry also runs entrepreneurship-training seminars for youth and in the past year 3692 young people were trained. Over 600 youth businesses attended fairs and exhibitions to market their products and services. Currently the ministry is collaborating with Local Enterprise Authority (LEA), First National Bank Botswana and Citizen Entrepreneurial Development Agency (CEDA) on training in entrepreneurship development and mentorship of YDF beneficiaries.

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